In fact, the culprits are so easy to identify we’ve included a picture drawn up by Dr Michael Crawford (see above). Before intermittent wind and solar entered the stage, Australia enjoyed the lowest power prices in the world; and no one talked about load shedding and statewide blackouts the way they do today. Funny about that.

Well, as they say, sooner or later we all sit down to a banquet of consequences.

The idea that an entire economy can run on sunshine and breezes is a patent nonsense and, after the debacle that’s played out in South Australia, anyone still peddling that idea should be sedated and scurried off to a padded cell, before they can inflict any more harm.

STT has been predicting that the Federal government’s Renewable Energy Target – a $60 billion tax on all Australian power consumers – would inevitably result in the wholesale destruction of jobs and whole industries for years now. Well, surprise, surprise…

Cut power bills or lose more jobs: ACCC chief’s warning on energy costs
The Australian
Glenda Korporaal
30 December 2017

Australia’s competition regulator, Rod Sims, who has been tasked with finding ways to cut power bills, has warned that high energy costs will force more plant ­closures and job losses as prices continue to increase.

“Energy affordability is Australia’s largest economic challenge,” the chief executive of the Australian Competition & Consumer Commission told The Weekend Australian.

“We have already seen jobs lost, investment reduced, plant closures (because of high energy prices). Unfortunately, we are going to see quite a bit more.”

Mr Sims said low-cost energy used to be the biggest competitive advantage of Australian businesses but “now it is our biggest source of comparative disadvantage”.

“We have gone from having energy costs being the best thing we had going for us to now being the worst,” he said.

Mr Sims’s comments come as the ACCC undertakes two major reviews for the federal government aimed at tackling Australia’s energy crisis.

The Turnbull government has been under pressure to get energy prices down, with economic growth and cost of living emerging as major political battlegrounds in 2018.

The Business Council of Australia yesterday backed Mr Sims’s comments, saying Australia’s com­petitive advantage in energy costs had been “eroded after a decade of poor and unco-ordinated policy, putting at risk Australian jobs and disadvantaging businesses and consumers alike”.

Mr Sims said the gas industry was on notice that the commission would be looking closely at its activities.

Prices have doubled and in some cases tripled for users of gas over the past five years. The ACCC’s interim report into the gas industry estimated industrial users in Australia could be paying up to double the international price for gas.

Chemistry Australia, a national industry group representing Australia’s chemicals and plastics industries, estimates gas prices for its members have tripled from about $5 a gigajoule five years ago to about $15 today. Some companies are having to pay even more for their gas.

Mr Sims said there were no quick fixes for the problems but the ACCC’s monitoring programs could help. “We want to keep the pressure on the markets (for gas and electricity),” he said. “We want everyone to know what is going on in the market, and that transparency itself can help ­improve the market.”

He said the biggest pressure would be on manufacturing companies that used gas, including those involved in making fertiliser, paper, glass, steel and bricks.

High energy prices were affecting sectors such as telecommunications companies, services that used refrigeration and farmers using irrigation. They were also affecting retailers, whose customers’ budgets were hit by rising electricity costs.

The ACCC is working on a review of ways to reduce energy costs, with a report due in June.

“We have a mandate to come up with recommendations to government to get energy prices down,” Mr Sims said.

“If we can come up with sensible recommendations, my guess is that governments will adopt them.”

The ACCC is now working on its three-year, wide-ranging review of the gas industry to come up with measures to improve the supply of gas in Australia, which has become critical with the start of exports of LNG from Gladstone in Queensland.

After its interim report in September, the ACCC began talks with big gas companies about supplying more gas to local companies, particularly those that faced gas shortages from next year.

Rising prices for electricity and gas have put the Turnbull government under pressure to come up with solutions despite the fact several key supply issues are state-based, with NSW and Victoria effectively banning development of new onshore gas fields.

Local manufacturing companies are now warning that there will be a shift of jobs and industries to the US, where energy prices have come down substantially and the Trump administration is cutting company taxes.

The executive director of the Australian Retailers Association, Russell Zimmerman, this week blamed the high cost of energy as a factor in holding consumers back from spending in the post-Christmas sales period.

ASX-listed fertiliser company Incitec Pivot is considering the future of its manufacturing plant at Gibson Island in Queensland, which employs more than 450 people.

The company said it was investigating options to secure affordable gas but “if no solution is found, it is likely the manufacturing facility will close”.

Perth-based chemical manufacturer Coogee Chemicals mothballed its methanol plant at Laverton in Melbourne last year as a result of higher gas prices. The company said yesterday it was closely watching the future of gas prices to see whether it would decommission the plant and ship it to the US to take advantage of cheaper gas prices.

Mr Sims said the ACCC was closely monitoring companies in Australia that were struggling to get gas from the beginning of next year.

It had had discussions with the LNG companies to encourage them to supply gas to local companies instead of selling it on the international spot market. “There is no doubt that, in some of the situations, the monitoring by the ACCC made the difference between some companies getting gas and not getting gas,” he said.

“In some cases it had an effect on the price they paid.”

A spokesperson for the Business Council of Australia said Australia’s “competitive advantage in energy costs has been eroded after a decade of poor and unco-ordinated policy, disadvantaging businesses and consumers alike.

“Households and businesses simply do not care about the petty politics of climate and energy policy — they care about being able to pay their bills.”The Australian

And families that occupy those households also care about having meaningful employment, now placed under permanent and mortal threat by Australia’s suicidal renewable energy policies.

What happens next is as inevitable as it was perfectly predictable. Plenty of businesses will sack workers in an attempt to remain solvent. While other businesses and whole industries will head offshore to places like Pennsylvania where, thanks to reliable nuclear, coal and gas power generation, power costs to business are less than 1/3 of what Australian businesses are forced to suffer (see our post here). Here’s an example of the former.

Manufacturing company Qenos is being forced to lay off 15 per cent of its 700-strong workforce as it battles to cope with higher energy prices, chief executive Stephen Bell said yesterday.

Mr Bell said Qenos, which has polyethylene plants in Altona in Melbourne and Port Botany in Sydney, had been battling hard to boost productivity following increases of up to $60 million a year in its gas and electricity expenses, but was now being forced to lay off staff.

“We have taken a lot of action working on every aspect of the business to improve our competitiveness, but it can only partially mitigate the impact,” he said.

“We are having to take out 15 per cent of our workforce at the moment.

“We have already started with a number of people over the last few weeks and it will continue into the New Year. We are doing it with great reluctance but we have a business to run. We have to take action to keep the business viable.”

Mr Bell said the manufacturing industry in Australia was “facing the very real prospect of further job losses” because of the impact of higher energy prices.

“I just don’t see how large industrial companies can continue (with) the sorts of cost increases we have sustained without having to take action.

“There is a very real prospect that some businesses might not be able to remain viable. With the prices we are seeing now for gas and electricity, some are just not sustainable.

“The rise in energy prices is a big issue for us, and for all large users of energy.”

Mr Bell said electricity prices at the company’s plant in Sydney had more than doubled since last year. He said he was also worried about the effect of rising energy prices on his company’s customers. “We are a very domestically focused business.

“We add value to local resources,” he said.

“I worry about our customers. They are consumers of energy and the dramatic escalation of energy costs is putting them under enormous pressure.

“It is a real issue for the whole value chain.”

Mr Bell said Australia had gone from having some of the cheapest energy in the world to being a country with the most expensive. Gas prices in the US had come down dramatically in recent years while prices in Australia had more than doubled, he said.

“In Australia we were paying $4 a gigajoule a few years ago for gas but in recent times the costs are between $10 and $15 a gigajoule,” he said.

“For most large industrial users, this is not competitive.”

He said the big fall in energy prices in the US had encouraged more manufacturing to move back to America while manufacturing in Australia was under pressure.

“We are competing against the world.

“We are going to see more industries go offshore.”

He said this would have long-term effects on Australia’s economy.

“Manufacturing is a sector which employs an enormous number of people,” he said.The Australian

The rapid increase in Australian gas prices runs against the international trend, which has resulted in a world awash with natural gas and real prices falling to historic lows (see above).

Australia’s gas market has suffered from the same eco-lunacy that led to massive subsidies for wind and solar power. The hard green-left have successfully crushed gas exploration with bans on even conventional gas extraction in Victoria.

Comments

Looking at the retail electricity prices chart, I’m wondering why Queensland, with virtually no renewables yet, has more expensive electricity than here in the UK, where about a quarter of our power is from renewables?

It has enormous rooftop domestic solar capacity, granted fixed Feed in Tarriffs of more than 50 cents per KWh. And its stated owned coal and gas generators have been directed to game the market to make huge profits to pay down its escalating debt.

Interesting. What is causing the gas & coal generators’ escalating debts, ie, why are their ordinary profits not enough to repay the loans for building or buying their power stations? And how much of the high prices is due to their rip-offs, and how much to the generous FiTs?

The debt was run up by the Labor govt spending on public service employment. The previous Liberal National govt had slashed the public service to reduce its debt and deficit. Labor got into power by promising to restore jobs for nurses, teachers, police etc. The power stations are being used as cash cows to fund those jobs, guaranteeing votes for Labor.

So part of Australia’s high electricity cost is effectively an indirect taxation for non-energy-related uses. I’ve read (though can’t find the source again) that some of Germany’s power bills also contain subventions for non-energy-related things.

The chart includes taxes, which vary from 5% VAT in the UK to about 20% VAT in Germany (I don’t know what tax is applied to domestic power bills in Australia).

So these factors need to be borne in mind when trying to draw conclusions from that chart. A better chart for comparisons would be one net of taxes and non-energy-related subventions.

[I say this as a general caveat, not as a criticism of STT, as the chart is not yours, and I doubt you have the raw data to make such a ‘net’ chart.]

Lol reading the comments. Yes! So predictable. But never fear! Turnbull and the Lib/Nats have it all under control and are focussed on the really important matters…like instituting a national opinion vote after the queen passes. And meanwhile, the Labor party is in cahoots with the Greens busily mustering unicorns for the next fairy and pixie dust rodeo.
Surprise! Surprise! Rod Sims is playing politics. It must be tough to speak the plain truth when you work in a politically appointed position: “Mr Sims said the gas industry was on notice that the commission would be looking closely at its activities.” Chickenpoop response and everyone with a modicum of energy awareness knows it. It’s so convenient to blame the fossil fuel companies because pointing the finger at renewable energy is not politically appropriate at this time with an election looming. Reading between the lines of Sims’ comments; he’s going to lay down the law to those mean and nasty gas companies. Maybe he doesn’t realize it, but the Australian energy market is in the same position as the customer walking from the train station to the car dealership then demanding a rock bottom price on a new car. The salesman’s response: “Sure! Have we got a deal for you!” Liddell’s closure is getting closer and closer and I’m fairly certain the eventual cost to the Australian taxpayer is following the Al Gore/Michael Mann hockeystick playbook.
Who could have guessed that the World’s left wing, liberal policies are managing to re-position energy companies from servants to masters of our destiny? Well done Australia!

Where to from here? Yes, dump the RET. It has to occur. The energy market needs to be opened and expanded rapidly to diversify supply and suppliers with an emphasis on reliability and dispatchability. So-called renewables have a place, but it’s a small, niche market until and only if some radical technological advancement comes along. That’s a big “IF”. Coal and fission and peaking gas are the best we have for the forseeable future and with the collapse of the global warming scam…the only options that make sense. Perhaps we’ll eventually have fusion. Who knows, but it’s still a better bet than solar and wind. The problem governments have is how to sell it.
Trump’s administration in the USA has found the support for the only successful method so far: outright rejection of global warming policies, holding a mirror up to the scammers who support it and holding them to task on their predictions and forecasts. Until Australian leaders do the same, they’re just letting the disease fester like gangrene.
I can’t help the feeling that the “gangreen” in the Australian economy is going to do a lot more damage before it’s cut off. The first major step is in correctly identifying the “gangreen” and not confusing the disease. Rod Sims’ comments indicate there’s a looooong way to go yet.

Unfortunately the enemy is the Australian voter, it is ‘they’ that support this insanity – but, in their defence, are the lies and misinformation fed to them daily for years that you can and must save the planet by running a national grid on intermittent unpredictable wind and sunshine – think ABC, all governments, all bureaucrats, all academics – all paid by government collected taxes – contrast this with Trump calling these people out as liars and users and destroyers of informed democratic processes. Last, but not least, is the fact that ‘wind farms’ never have and never will be ‘fit for purpose’ as generators of electricity grid dispatchable power necessary for a modern society – a revolution in the brewing!

The general public loves the notion that we can power the planet using only wind, solar, water and other “natural” ingredients, and politicians can’t resist another way of dipping their hands into our pockets in exchange for campaign contributions. The truth is, the only way we can effectively reduce CO2 emissions while maintaining a modern lifestyle is to replace fossil-fueled power plants as they retire with nuclear-powered ones. Everything else is just a fantasy of people who are either uninformed or have no conscience.

One can only imagine what the Australian government of today would do if it was faced with an outbreak of Bubonic plague or Smallpox. The first thing they would do is consult a medium then start bleeding or forcing infected patients to eat garlic. Believe it or not there is a plan that state governments followed back in the 1960’s and 1970’s to produce the cheapest and most reliable power in the world in Australia but along came the university educated loony’s who want to save the planet but still have all the goodies and jobs that cheap power produces. While Australia prays at the magic pudding idol in fantasy land there will be no improvement into what is in fact a very easy problem to solve. Cheap electricity generated by coal fired power stations that proved so successful decades ago but has now been overtaken by fools who think they can generate electricity with magic wands.

You first have to accept your in a hole.
Accepting you have made a mistake is something Politicians have trained not to do. Honest politicians, those who can see danger and want to work to side step it soon find a knife in their backs.
The only way Australia will stop the rot is for the people to wakeup and get rid of those who are there working for themselves and not the people they said they would work for. Though we do have an opportunity to get things moving in the right direction if only our Federal Leader would move out of Politics and back into ‘fairy land’ where he belongs and for all other politicians no matter their political side start working for us the people.
Gas prices began to rise years ago, it was first noted when those who turned their cars to operate on gas began to see the price at the pump rise higher than what it was being sold for overseas, but nothing was done to stop it, nothing was done to ensure Australians benefited first from its resources with what was left sold overseas at a higher price than in Australia.
Australia has been wasteful of its resources because of the push and constant demand for being seen as good international traders reliant on income from such stupidity.
We have for far too long allowed all our resources to be sent overseas before we have had a chance to use all we need for our own purposes.
This is even evident in the top quality fresh food we don’t have here anymore because its all been sold overseas before we can get our hands on it. We are left with the ‘second rate’ stuff which people overseas don’t want and we have to pay top price for it.
We need to start looking to our own needs and not what the world wants from us.
The first step is to shut of the RET, then to encourage investment in energy production which meets our needs.
We can build clean coal plants, we can build some form of nuclear energy plants, we can use OUR OWN gas resources without having to resort to Fracking for it.
We can do all this without destroying our farming lands, our forests, our precious unique environments, and we can save our industries and businesses – but it will take people at the top who make the decisions to take the blinkers off, to accept Australia is a great Nation that does not have to bow to international demands, a Nation that should and in many cases does do its bit to ensure a safe world for all.
WAKE UP POLITICIANS OF ALL SIDES AND START TO WORK FOR US – AUSTRALIANS.
We don’t need anymore reports that are most likely going to be tainted with the UN demand of an emission reduction level no country can truthfully reach without destroying itself. We already know what the problem is and we know what the answer to rectify it is.
Remember SA has now accepted ‘renewables’ cannot be relied on and are unsuited to our modern economy, why else would they purchase a ‘big battery’ (white elephant), hire then purchase diesel generators to eventually be converted to gas generators. Obviously but not publically accepted by its Government an
admittance of policy failure.
Recently you’ve been caught up in having to be only ‘Australian citizens’ to do your job – start doing it.